January 19, 2009

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MMA Continues Advocacy in Opposition to Hospital Cuts in Supplemental Budget

Following up MMA's testimony before the Appropriations and HHS Committees on January 5, 2009, MMA's legislative advocates this past week continued to express the MMA's opposition to the Governor's proposed cuts to both "provider-based" reimbursement and critical access hospitals (approximately $4.5 million General Fund/$33 million total, state and federal funding) in his supplmental budget bill, L.D. 45.  As was clearly articulated in the state's own report from the Primary Care Study Commission in 2008, MaineCare reimbursement can not be fixed by pulling the provider-based entities down to the low level of reimbursement paid under the fee schedule, but needs to be improved by bringing the fee schedule up to the level of provider-based reimbursement.  Similarly, cutting the reimbursement to Maine's 17 critical access hospitals from 117% of costs to 101% is a breach of trust to these institutions that pay a hospital tax which is then recovered (in whole for some and in part for others) by payment at the 117% level.  Enactment of this cut will mean that all of Maine's CAHs, located in the rural areas of the state, will pay more tax than they receive back.  The MMA will continue to work closely with the MHA on this important policy matter.

During an initial joint work session of the Appropriations and HHS Committees on L.D. 45 last week, it became clear that the two hospital cuts are the most significant issues in the supplemental budget and that the policy issues implicated in these proposals are too difficult for the committees to try to resolve as a group.  Accordingly, the chairs established a subcommittee of the two committees to examine the policy implications in detail and to make a recommendation to the entire membership of both committees.  

Members of the subcommittee are Representatives Anne Perry (D-Calais), Lisa Miller (D-Somerville), and Bob Nutting (R-Oakland) and Senators Peter Mills (R-Somerset), Richard Rosen (R-Penobscot), and Lisa Marrache (D-Kennebec).

During a meeting of the subcommittee on Friday, January 16, 2009, members expressed concern about trying to get a handle on the policy implications of the two proposals and to make informed decisions on them in the tight timeframe required for the supplemental budget - likely to be wrapped up this week.  During a lengthy and wide-ranging discussion to educate themselves about various aspects of hospital and physician reimbursement in Maine, the hospital "tax and match" history in the state, the federal requirements of the critical access hospital and provider-based reimbursement programs, and the status of the State's reconciliation of MaineCare payments to hospitals, the subcommittee members recognized that they did not want to rush to a decision on these proposals.  So, they spent the balance of their time Friday morning considering various ways to defer these decisions to the biennial budget.  Among the options discussed are taking $4.5 million from the rainy day fund or "pushing" hospital PIPs.  The subcommittee asked DHHS Commissioner Harvey to conduct some further financial analysis of ways in which these issues could be deferred to the biennial budget discussion.  The subcommittee expects to meet again around mid-day on Wednesday, January 21, 2009.   

Because there seems to be consensus that a proposed federal rule requires (unless stopped by the incoming Obama Administration) hospital-based physicians to be paid on a fee schedule, a potential alternative to the proposed hospital-based physician cut would be a shift of come funding to the MaineCare fee schedule.  After two $3 million General Fund increases in the MaineCare fee schedule enacted at the urging of the Baldacci Administration during the past 8 year, MaineCare rates are now 56 or 57% of Medicare rates on average.  The MMA has argued that a goal should be to increase MaineCare rates until they match Medicare rates.  This action would also have the positive effect of encouraging private practices to take more MaineCare patients.  Based upon information obtained this past week from the AMA, it is estimated that Medicare is only reimbursing physicians at 2/3 of the cost of providing the service.  And because of geographical disparities, Maine's fees from Medicare are among the bottom quartile in the country.

With the dual challenges of physician recruitment and retention and access to primary care in the rural areas of our state, it is poor state policy to be cutting MaineCare reimbursement to physicians practicing in any setting.

While the MMA and MHA now believe that the Appropriations and HHS members are attuned to our concerns about these proposals, we encourage you to contact your own Senator and Representative to urge them to reject these hospital cuts.

You can find your legislators on the web at:  http://www.maine.gov/legis/house/townlist.htm.

Or, you can leave a message for legislators at the State House this week as follows:

·         Representatives: 1-800-423-2900

·         Senators: 1-800-423-6900  

MMA members wishing to learn more about this issue or willing to contact legislators can obtain more information by contacting Andrew MacLean, Deputy EVP by phone at 622-3374, ext. 214 or by email at amaclean@mainemed.com or Gordon Smith, EVP by phone at 622-3374, ext. 212 or by email at gsmith@mainemed.com.


Report on MMA Executive Committee Retreat

MMA's Executive Committee held its annual retreat this past weekend in Jackson, N.H.  In three focused sessions, Committee members:

1.  Were presented with a report on development and the potential for establishment of a long-term financial development plan including planned giving for the benefit of the Maine Medical Education Foundation and the Maine Medical Education Trust.

2.  Heard from worksite wellness expert Lisa Downing of Diversified Business Communications on the philosophy and details behind a comprehensive worksite wellness program.  Each committee member was asked to think about action that the member could take to improve health in the workplace, in local schools, and in his or her community.  Members were reminded that an important part of the MMA mission is to promote the health of Maine citizens.

3.  Reviewed results of the recent membership survey.  More than 34% of the Association's active membership took time to complete the comprehensive survey conducted by enetrix, a subsidiary of the Gallup organization.  Over the coming weeks, both Maine Medicine and Maine Medicine Weekly Update will publish the results of the survey.  Committee members were pleased to see that a high percentage of members who responded to the survey stated that they found value in MMA membership.

The President's Retreat was facilitated by current President Stephanie Lash, M.D with assistance from President-elect David McDermott, M.D., MPH and Jo Linder, M.D., Chair of the Executive Committee.  Eighteen members of the Committee participated. [return to top]

AMA Provides Overview of Health Aspects of Economic Stimulus Bill to be Considered by Congress this Week

The AMA's Senior Vice President for Advocacy, Rich Deem, has provided the following overview of the federal economic stimulus legislation.

This week, Congress will begin considering an $825 billion stimulus package, the American Recovery and Reinvestment Act.  The legislation will contain $275 billion in tax relief and $550 billion in direct spending in an effort to stimulate economic activity.  A number of provisions will affect health care.

Specifically, Congress will provide more money to states through increased funding for Medicaid programs and subsidies directed to individuals who become uninsured so that they may maintain health care coverage. Additional funding will be provided for health care infrastructure, training, and research.

Of particular note are several provisions that will be characterized as “down-payments” of health care reform.  These include a $20 billion investment in Health Information Technology and $1.1 billion for comparative effectiveness research conducted through existing authorities.  Though details on these specific provisions were being resolved over this past weekend and may be modified in committee mark up this week, some specifics are known. 

Two billion dollars of the HIT funding will be invested in health care IT infrastructure and standards development.  It is expected that most of the remaining funding will be for providers who adopt HIT and use it in the care of Medicare, Medicaid, and SCHIP patients.  Much like the recently enacted ERx legislation, the program is expected to take the form of payment bonuses followed several years later by penalties for non-adopters.  AMA staff has met with the authorizing committee staffs several times on these issues and will do so again once specifics of the proposal are known.

An initial review of the few available details of comparative effectiveness provisions provides hope that the process will include considerable physician input and focus on clinical effectiveness rather that simply on cost effectiveness. 

We will convey additional details on the health provisions later this week.  House floor consideration is expected to follow during the week of January 27.  AMA will provide a more detailed analysis once legislative language is available.  In the meantime, below you will find summary information on the health care proposals released by the House Appropriations and Ways and Means Committees.


To save not only jobs, but money and lives, we will update and computerize our healthcare system to cut red tape, prevent medical mistakes, and help reduce healthcare costs by billions of dollars each year.  

Health Information Technology: $20 billion to jumpstart efforts to computerize health records to cut costs and reduce medical errors.  

Prevention and Wellness Fund: $3 billion to fight preventable chronic diseases, the leading cause of deaths in the U.S., and infectious diseases.  Preventing disease rather than treating illnesses is the most effective way to reduce healthcare costs.  This includes hospital infection prevention, Preventive Health and Health Services Block Grants for state and local public health departments, immunization programs, and evidence-based disease prevention.  

Healthcare Effectiveness Research: $1.1 billion for Healthcare Research and Quality programs to compare the effectiveness of different medical treatments funded by Medicare, Medicaid, and SCHIP.  Finding out what works best and educating patients and doctors will improve treatment and save taxpayers money.  

Community Health Centers: $1.5 billion, including $500 million to increase the number of uninsured Americans who receive quality healthcare and $1 billion to renovate clinics and make health information technology improvements.  More than 400 applications submitted earlier this year for new or expanded CHC sites remain unfunded. 

Training Primary Care Providers: $600 million to address shortages and prepare our country for universal healthcare by training primary healthcare providers including doctors, dentists, and nurses as well as helping pay medical school expenses for students who agree to practice in underserved communities through the National Health Service Corps.

Indian Health Service Facilities: $550 million to modernize aging hospitals and health clinics and make healthcare technology upgrades to improve healthcare for underserved rural populations.
COBRA Healthcare for the Unemployed: $30.3 billion to extend health insurance coverage to the unemployed, extending the period of COBRA coverage for older and tenured workers beyond the 18 months provided under current law.  Specifically, workers 55 and older, and workers who have worked for an employer for 10 or more years will be able to retain their COBRA coverage until they become Medicare eligible or secure coverage through a subsequent employer.  In addition, subsidizing the first 12 months of COBRA coverage for eligible persons who have lost their jobs on or after September 1, 2008 at a 65 percent subsidy rate, the same rate provided under the Health Care Tax Credit for unemployed workers under the Trade Adjustment Assistance program. [Ways and Means]
Medicaid Coverage for the Unemployed: $8.6 billion to provide 100 percent Federal funding through 2010 for optional State Medicaid coverage of individuals (and their dependents) who are involuntarily unemployed and whose family income does not exceed a State-determined level, but is no higher than 200 percent of poverty, or who are receiving food stamps.   
Medicaid Aid to States (FMAP): $87 billion to states, increasing through the end of FY 2010 the share of Medicaid costs the Federal government reimburses all states by 4.8 percent, with additional relief tied to rates of unemployment.  This approach has been used in previous recessions to prevent cuts to health benefits for their increased low-income patient loads at a time when state revenues are declining.  
Medicare and Medicaid Regulations: The bill extends the moratorium on select Medicaid and Medicare regulations through October 1, 2009.  

Scientific Research

National Science Foundation: $3 billion, including $2 billion for expanding employment opportunities in fundamental science and engineering to meet environmental challenges and to improve global economic competitiveness, $400 million to build major research facilities that perform cutting edge science, $300 million for major research equipment shared by institutions of higher education and other scientists, $200 million to repair and modernize science and engineering research facilities at the nation’s institutions of higher education and other science labs, and $100 million is also included to improve instruction in science, math and engineering.

National Institutes of Health Biomedical Research: $2 billion, including $1.5 billion for expanding good jobs in biomedical research to study diseases such as Alzheimer’s, Parkinson’s, cancer, and heart disease - NIH is currently able to fund less than 20% of approved applications – and $500 million to implement the repair and improvement strategic plan developed by the NIH for its campuses.

University Research Facilities: $1.5 billion for NIH to renovate university research facilities and help them compete for biomedical research grants.  The National Science Foundation estimates a maintenance backlog of $3.9 billion in biological science research space.  Funds are awarded competitively.

Centers for Disease Control and Prevention: $462 million to enable CDC to complete its Buildings and Facilities Master Plan, as well as renovations and construction needs of the National Institute for Occupational Safety and Health.    

Biomedical Advanced Research and Development, Pandemic Flu, and Cyber Security:  $900 million to prepare for a pandemic influenza, support advanced development of medical countermeasures for chemical, biological, radiological, and nuclear threats, and for cyber security protections at HHS.  

Technology Improvements for a More Efficient and Secure Government
Social Security Administration Modernization
: $400 million to replace the 30 year old Social Security Administration’s National Computer Center to meet growing needs for processing retirement and disability claims and records storage.  

Department of Defense Facilities

Medical Facilities: $3.75 billion for new construction of hospitals and ambulatory surgical centers, and $455 million in renovations to provide state-of-the-art medical care to service members and their families.  
Veterans Administration Facilities

Veterans Medical Facilities: $950 million for veterans’ medical facilities.  The Department has identified a $5 billion backlog in needed repairs, including energy efficiency projects, at its 153 medical facilities.

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MMA to Support Representative Treat's "Health Care Bill of Rights" Legislation

MMA Executive Vice President Gordon Smith participated in a press conference this week with State Representative Sharon Treat to indicate MMA's support for legislation requiring more transparency from the state's health plans.  Rep. Treat is preparing legislation entitled a "Health Care Bill of Rights" which will require health plans to:

  • Have a loss ratio of 85% or greater (we prefer to call this a claims payment ratio);
  • Post comparative information on administrative costs, reserves, profit, and other expenses;
  • Increase transparency of premium increase requests; and
  • Standardize insurance claim forms and EOB forms.

At the MMA's request, the legislation also will require that any plan programs ranking or profiling physicians will be transparent to patients, meet certain standards, and will allow a physician to appeal his or her "ranking."  These provisions are directed specifically to health plans' tiered networks.  Addressing concerns raised by pediatricians, the legislation also will require health plans to clearly disclose the coverage status of childhood immunizations.

Finally, the legislation also will provide standards for disclosing pricing of medical services by physicians and hospitals.  The details of this provision are not available as the provision has not yet been drafted.  It would be the intent of MMA to support conceptually the ability of patients to know the price of a given service, but to minimize any administrative burden on physicians or hospitals.  The 2003 legislation establishing the Dirigo Health Agency already requires the price disclosure of the most common services provided.

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AMA Advocacy Results in Latest Cuomo Settlement with Insurers on UCR Database

Last week, New York Attorney General Andrew Cuomo (D) reached a settlement with UnitedHealth Group (UHG) in a dispute between the insurer and the AMA about United's Ingenix unit's industry-wide database used by most insurers to determine the "usual, customary & reasonable" costs of medical services (UCR).  AG Cuomo found that the Ingenix database undervalued the cost of medical services by as much as 28%, meaning that patients were required to pay a higher proportion of their medical bills than they should have been.  The settlement requires UHG to spend $50 million to fund the development of a new, impartial database probably housed at a non-profit such as a university.  AG Cuomo also reached a similar settlement with Aetna and that company has agreed to pay $20 million towards the new database. [return to top]

MedPAC Recommends 1.1% Medicare Fee Increase for Physicians in 2010

On January 8, 2009, the Medicare Payment Advisory Commission (MedPAC) voted to increase Medicare payments to physicians by 1.1% in 2010 in its annual review of physician reimbursement.  The actual Medicare payments to physicians will be determined by the "sustainable growth rate" (SGR) formula that will result in a 20% cut in rates.  In 2008, Congress enacted MIPPA to reverse a 10.6% cut in Medicare reimbursement under the SGR and to replace it with a payment freeze for the balance of 2008 and a 1.1% increase in 2009.  Congress is expected to consider legislation to address the 2010 cut required by the SGR this year.

The AMA has published a document on its web site to help you understand the 2009 Medicare payment rates entitled, 2009 Medicare Physician Payment Rates:  What to Expect in Your Practice:   http://www.ama-assn.org/ama1/pub/upload/mm/399/2009-medicare-fee-schd-highlights.pdf. [return to top]

U.S. House Passes SCHIP Reauthorization & Expansion Bill

On Wednesday, January 14, 2009, the U.S. House passed H.R. 2, the Children's Health Insurance Program Reauthorization Act of 2009, by a vote of 289-139.  The bill would reauthorize the SCHIP for 4.5 years and would expand coverage to an additional 4.1 million children.  This would expand the program by $32.3 billion above baseline spending and would bring the total number of children covered to 11 million.  H.R. 2 is funded primarily by a $0.61 per pack increase in the federal cigarette tax (to $1 per pack) and a prohibition on physician referral to specialty hospitals in which they have an interest.  The Senate Finance Committee was scheduled to begin work on a companion bill on January 15, 2009.  At this time, the Senate bill does not include the specialty hospital referral ban. [return to top]

MMA NewsScan Not Available for a Brief Period

Because of a change in staffing at the Vermont Medical Society, the organization that prepares the weekly NewsScan for MMA, the weekly publication will not be available for a short time.  MMA intends to proceed expediently to find an alternative means of bringing you the service until VMS can resume its contract with MMA.  Thanks to all the regular readers for your patience during this interruption.  The NewsScan is a summary of the week's news clips involving health care and is usually sent electronically to MMA members by the middle of each week.

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PMP Web Portal Changes Take Effect

This month, the Office of Substance Abuse switched to a new web portal for its Prescription Monitoring Program (PMP). The new portal includes new features, including automated password recovery. The change to the new portal will also mean a change to a new web site host, but the previously publicized web address, www.maine.gov/pmp, will redirect to the new site.

If you are a previously registered user, you can retrieve your password by clicking on the OSA logo in the middle of the main page, clicking the "Password Recovery" tab, and entering your username or email address. You will receive a message to the email account on file with Goold Health Systems (within a few minutes), that will contain a link to bring you to a password reset screen.On that screen, you'll be asked for your state license number.  If you do not receive an email message, you will need to contact the help desk during business hours.

Should you need help at any point, please call or email the help desk at 866-749-7838 or mepdmphelpdesk@ghsinc.com. [return to top]

Maine Health Access Planning Grant: Expanding Recovery Medical Homes at Behavioral Health Centers

A group of 7 statewide partners representing mental health, substance abuse, family, advance practice nursing, and consumer organizations is seeking interested primary care physician(s) to participate in a steering committee for a planning grant to develop procedures to assist 2 behavioral health agencies in the development of procedures to screen and to provide prevention and treatment of physical health issues present in the population the pilot agencies serve.  The steering committee initially will meet monthly, moving to meeting every other month after the first three months.  The meeting will be held in Augusta and teleconferencing will be available if desired.  Once the pilot agencies have been chosen, the steering group will be looking for interested health care providers to provide physical health care services at the 2 pilot agencies, however, providing those services is not a requirement for participation on the steering committee.  The grant’s focus is to plan and to pilot procedures in support of the integration of physical health care with mental health and substance abuse services and to enhance self-help services within mental health and substance abuse agencies across Maine.

If you are interested in participating, please contact Gordon Smith, EVP by phone at 622-3374, ext. 212 or by email at gsmith@mainemed.com.

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New Bills for Your Review & Comment/Legislative Committee Conference Call Schedule

There is only one new bill for review this week:

 LD 136, An Act To Require the Provision of Unstructured Recess Time for Elementary School Students (support; pediatricians, Public Health Committee)

The MMA Legislative Committee will commence its weekly legislative conference calls this Thursday evening (1/22) at 9 p.m.  Please plan on this day and time for each week through the end of the session in mid-June.  This week we will discuss the bills from last week's Maine Medicine Weekly Update and the one listed above. 

The conference call line is 1-800-989-2842 and the access code is 6223374#.  

Any member who is interested in the MMA's legislative advocacy is welcome to participate.
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For more information or to contact us directly, please visit www.mainemed.com l ©2003, Maine Medical Association